Cryptocurrency is a digital asset secured through encryption methods, making counterfeiting challenging. Its most appealing feature is its organic nature, preventing theoretical interference or manipulation by governments. Operating without a central authority or bank, it is collectively mined by a network. This independence allows cryptocurrencies to provide a secure and autonomous payment system.

All cryptocurrency transactions are recorded in a blockchain, a chain of blocks containing cryptographic hashes of previous blocks and timestamps. Bitcoin nodes use the blockchain to verify transaction legitimacy and prevent double-spending attempts.

Created in 2009 by an individual or group named Satoshi Nakamoto, Bitcoin is a decentralized cryptocurrency and payment system. With no central authority, bitcoins are collectively issued by the network. Bitcoin’s open-source design enables various applications previously deemed impossible.

New cryptocurrencies are often created through a process called “forking,” where a group of developers creates a new version of an existing cryptocurrency. The new currency has its blockchain, usually identical to the old currency up to a certain point. Bitcoin Cash, for example, resulted from forking the Bitcoin blockchain.

Initial Coin Offerings (ICOs) allow new cryptocurrency ventures to raise funds by offering tokens to early supporters. Startups utilize ICOs for financing expansion efforts, providing tokens to backers, enabling the creation of new cryptocurrencies.

Computer protocols that facilitate, verify, or enforce are known as smart contracts. Smart contracts can be used to perform verifiable transactions without relying on third parties. These transactions can be tracked and irreversible.

A blockchain is a digital ledger containing all cryptocurrency transactions. Each block in the chain includes the cryptographic hash of the previous block, a timestamp, and transaction data. Bitcoin nodes use the blockchain to distinguish legitimate transactions from attempts to spend coins already spent elsewhere.

Mining is the method of creating new cryptocurrencies. Miners use powerful computers to solve complex mathematical problems. Upon solving a problem, they are rewarded with a cryptocurrency.

Forking is when a group of developers creates a new version of an existing cryptocurrency. The new currency typically shares the same blockchain as the old one up to a certain point.

A wallet is a software program that stores your public and private keys and interacts with the blockchain to enable you to send and receive cryptocurrency.

A private key is a string that allows you to access your cryptocurrency. If someone else has your private key, they have access to your funds.

A public key is a string that allows people to send you cryptocurrency. Your public key is similar to an address that senders use to transfer cryptocurrency to you.

A blockchain explorer is a website that enables you to view all transactions on a specific blockchain. It’s useful for checking the status of a transaction or address and finding information about a particular block or chain.

KYC stands for “know your customer.” It’s a process exchanges use to verify the identity of their users, usually involving the submission of documents such as a passport or driver’s license.

Token is a term used for cryptocurrency or cryptoasset. It can refer to all cryptocurrencies except Bitcoin and Ethereum, or specific digital assets running on another cryptocurrency’s blockchain. Tokens have various functions, from facilitating decentralized exchanges to representing ownership of unique digital or real-world assets.

A Non-Fungible Token (NFT) is a type of crypto asset that verifies the uniqueness and ownership of digital assets. Built on blockchain technology, NFTs represent digital assets, each with a unique digital footprint and identifier. Various forms of digital media, including art pieces, music, gaming content, and more, can be tokenized as NFTs. NFTs enable the trading, selling, and collecting of digital assets by providing a unique digital identifier for each NFT, securely tracking ownership and authenticity. NFTs have revolutionized digital asset ownership, bringing new value and trading dynamics to the world of digital art.

A stablecoin is a cryptocurrency pegged to a stable reserve asset, such as the U.S. dollar or gold, designed to reduce volatility compared to unpegged cryptocurrencies like Bitcoin.

DeFi, short for decentralized finance, encompasses financial services offered on public blockchains like Ethereum. These services include earning interest, borrowing, lending, buying insurance, trading derivatives, and assets.

Cryptography is the study and practice of sending secure, encrypted messages or data between two or more parties. In the context of cryptocurrencies like Bitcoin, cryptography is crucial for enabling secure, anonymous, and trustless transactions. Bitcoin and other cryptocurrencies use public-private key encryption to facilitate transactions without the need for a trusted intermediary.